Paving Equipment of Carolinas Inc. v. M & N DEV. CO.
| Citation | 182 BR 425 |
| Decision Date | 19 May 1995 |
| Docket Number | No. 3:94CV199-P.,3:94CV199-P. |
| Court | U.S. District Court — Western District of North Carolina |
| Parties | PAVING EQUIPMENT OF The CAROLINAS INC., Appellant, v. M & N DEVELOPMENT COMPANY, Appellee. |
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Richard M. Mitchell, Charlotte, NC, for appellant.
Herbert W. Hamilton, Rock Hill, NC, for appellee.
THIS MATTER is before the Court on Paving Equipment of the Carolinas, Inc.'s (PECI), appeal from the Bankruptcy Court's decision granting summary judgment in favor of M & N Development Company ("M & N").
This action was originally brought by M & N in the Court of Common Pleas for York County, South Carolina to remove a lien on real property held by PECI. PECI then filed a counterclaim alleging breach of contract against M & N. This action was subsequently removed to the Bankruptcy Court for the District of South Carolina and venue was transferred to the United States Bankruptcy Court for the Western District of North Carolina with the consent of both parties. M & N's Motion for Summary Judgment was heard in the Bankruptcy Court on February 3, 1994. The Bankruptcy Court granted Summary Judgment in favor of M & N on February 15, 1995. The Bankruptcy Court denied PECI's Motion to Alter or Amend Judgment on May 17, 1994.
On September 15, 1994 this Court dismissed PECI's appeal for failure to prosecute. On reconsideration, this Court, by Order filed October 26, 1994, allowed PECI to designate the record and move forward with the appeal. M & N filed a response brief on December 5, 1994. PECI filed a Reply on December 12, 1994 and an amended Reply on December 15, 1994.
Appellant raises on appeal the issue of whether the bankruptcy court erred by finding from the forecast of the evidence presented that no genuine issues existed as to any material facts regarding PECI's role as a general contractor on the Carolina Point project and the statute of limitations bar.
Summary judgment is appropriate when the pleadings, responses to discovery, and the record reveal that no genuine issue of any material fact exists and that the moving party is entitled to judgment as a matter of law. (See Fed.R.Civ.P. 56(c) and Bankruptcy Rule 7056, applying Fed.R.Civ.P. 56 to adversary proceedings.) Accordingly, the judge's role in ruling on a motion for summary judgment is to determine, based on the parties' pleadings and affidavits, whether any material issues of fact exist that require a trial. If the only issues to be decided are issues of law, then summary judgment is proper. When considering motions for summary judgment, courts must view facts and inferences in the light most favorable to the party opposing the motion for summary judgment. Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587-88, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986); United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962). When, however, the evidence from the entire record could not lead a rational fact-finder to find for the non-moving party, no genuine issue for trial exists and summary judgment is appropriate. Matsushita, 475 U.S. at 587, 106 S.Ct. at 1356.
On an appeal the district court may affirm, modify, or reverse a bankruptcy judge's judgment, order, or decree or remand with instructions for further proceedings. Findings of fact, whether based on oral or documentary evidence, shall not be set aside unless clearly erroneous. (Bankruptcy Rule 8013). The Court has reviewed the briefs, the record on appeal and the relevant legal authorities. Based upon its review of this case, the Court finds that summary judgment was appropriately granted against PECI by the Bankruptcy Court.
The pertinent facts are as follows. PECI did grading and paving work for M & N at an industrial real estate park in York County, South Carolina, known as Carolina Point and also on other projects, including the Lake Wylie project, also in York County, South Carolina, and the Pineville Towne Center project, in North Carolina. PECI is not licensed as a general contractor in South Carolina or North Carolina. There was no written contract between the parties and PECI admits that "all paving on or in the development known as `Carolina Point' was a part of a single continuous contract on the whole of that development." The last work done by PECI in Carolinas Point was the parking lot for the building located on Lot 33 on November 23, 1993.
The sum and substance of PECI's appeal is premised on their arguments that the South Carolina contractor licensing statute is not applicable to the work which they performed on the Carolina Point project. As grounds for that argument PECI asserts that (1) when strictly construed as required, their activities are not included in the definition of general contractor and not the type of work listed in the statute, and (2) that there are genuine issues of material fact concerning whether PECI performed multiple undertakings or a single undertaking on the Carolina Point project.
S.C.Code § 40-11-100 (1976 as amended).
For purposes of this chapter:
A "general contractor" shall be one who for a fixed price, commission, fee, or wage undertakes or offers to undertake the construction or supervision of any building, highway, sewer, grading, improvement, reimprovement, structure, or part thereof, when the cost of the undertaking is thirty thousand dollars or more. Anyone who engages in such undertaking in this State shall be deemed to have engaged in the business of general contracting in this State.
S.C.Code § 40-11-10(1) (1976 as amended).
Also of some use to a proper interpretation and application of the statutes is the South Carolina Licensing Regulation § 29-5 which provides:
(See S.C.Code Regulations § 29-5) (emphasis added).
Boiled to its essence PECI's first argument is that paving is not included among the activities enumerated under the South Carolina statutory definition for general contracting, § 40-11-10, and further that PECI is a subcontractor exempt from the statutory requirements. Therefore, or so appellant's argument goes, their activities were not unlawful, their role was not that of a general contractor, the South Carolina statute is not applicable to them, and the oral contract governing work at the Carolina Point project is therefore enforceable. PECI begins by accusing M & N of using regulatory provisions to bootstrap "paving" back into the scope of activity deemed illegal by South Carolina Code §§ 40-11-100 and 40-11-10.
Despite these arguments, for the reasons cited below, the Court finds that the grading and paving work performed by PECI on the roads and parking lots at the "Carolina Point" project clearly constitutes construction of a highway, grading, improvement, reimprovement, structure, or part thereof which exceeded the cost of thirty thousand dollars. Accordingly, the Court finds that PECI was not licensed as a general contractor in South Carolina and was thus prohibited from bringing an action to recover on this contract. The Appellant, in part admits as much, conceding that M & N "may have been entitled to partial summary judgment covering work PECI performed involving grading." Appellant also acknowledges that in both North Carolina and South Carolina the self-proclaimed status "subcontractor" does not in and of itself exempt a party from the licensing requirement — a license is required if the type of work done is that which is referred to by the statute. Florence Concrete Products, Inc. v. North Carolina Licensing Board for General Contractors, 113 N.C.App. 270, 437 S.E.2d 877 (1994).
Based on this admission, the only issue remaining on this point then is whether or not the other activities performed by PECI on the various projects, including paving, is encompassed within the meaning of the statute governing the licensing requirements for a "general contractor" in South Carolina. PECI strenuously argues in accord with the rule of strict construction for criminal statutes, that the work which they performed is not embraced by the statute. However, the Court finds this argument to be both misplaced and disingenuous. Clearly,...
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